Stride Property Group profit up 420%, buying new $152m office block

AA Insurance at 46 Sale St, built by Mansons TCLM. Photo / OneRoof

Stride Property Group, with a $1.1 billion portfolio, has reported its annual result and announced it is buying the AA Insurance Centre built by Mansons TCLM for $152 million.

Net profit after tax was $131.9m for the year to March 31, 2021, up 420 per cent on last year's $25.3m.

The business said its cash dividend represents a payout of 86 per cent of distributable profit.

Stride manages Diversified NZ Property Trust, a wholesale property fund which owns four retail shopping centres as well as Investore Property, an NZX-listed entity which owns large-format retail assets and Industre Property.

Assets include Massey's NorthWest shopping centre, Lower Hutt's Queensgate which is being rebuilt and 215 Lambton Quay in Wellington.

Stride said today it has stuck an unconditional agreement to buy the AA Insurance building at 46 Sale St in Auckland's western CBD precinct, in a deal due to settle at the end of next month.

The board intends to pay a combined cash dividend for SPL and SIML during FY22 of 9.91 cents per share.

"Stride delivered a better than expected outcome following the financial impact of Covid-19," it said.

"The financial impact of Covid-19 for FY21 was a $300,000 increase in distributable profit. This compares favourably to the initial estimated impact of a decrease of $2.9m to $5.1m in June 2020. The difference is primarily due to higher investment management income and better than expected rent relief arrangements," it said.

Stride has $3b assets under management, earns an annual income fee of $25.1m (last year $6.8m) and said it had done particularly well.

"FY21 was an extraordinary year for Stride, having successfully managed the impacts of COVID-19 while also achieving significant milestones in growing its real estate investment management strategy," it said.

Shares are trading around $2.35, up 44 per cent annually.